Slide 1: Fourth Quarter and Full Year 2020 Earnings Presentation
Fourth Quarter and Full Year 2020 Earnings Presentation February 1 2021
Slide 2: Legal Notices
Legal Notices SAFE HARBOR Please note that in this presentation, we may discuss events or results that have not yet occurred or been realized, commonly referred to as forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statement
Slide 3: Full Year 2020 Highlights
Full Year 2020 Highlights ✔ ✔ Operational Excellence & Prudent Capital Allocation In the context of a significant COVID-19 impact… 9% 2% Strategic acquisition of DMP launching new sustainability platform for wastewater treatment and recycling systems Growth in Constant currency Adj. EPS* adj. EBITDA
Slide 4: Fourth Quarter 2020 Financial Results
Fourth Quarter 2020 Financial Results Constant Currency* Organic* ($ in millions) Q4 2020 Q4 2019 YoY YoY YoY Net Sales $537 $455 18% 16% 10% Electronics 343 272 26% 23% 16% Industrial & Specialty 193 183 6% 5% 1% GAAP Diluted EPS $0.12 $0.29 Adj. EBITDA* $126 $102 23% 20% % margin 23.5% 22.5% 100 b
Slide 5: Full Year 2020 Financial Results
Full Year 2020 Financial Results Constant Currency* Organic* ($ in millions) FY 2020 FY 2019 YoY YoY YoY Net Sales $1,854 $1,836 1% 1% (3%) Electronics 1,172 1,086 8% 8% 2% Industrial & Specialty 682 750 (9%) (8%) (10%) GAAP Diluted EPS $0.31 $0.30 Adj. EBITDA* $423 $417 1% 2% % margin 22.8% 22.7% 1
Slide 6: Full Year 2020 Segment Details
Full Year 2020 Segment Details Market Commentary Electronics Net Sales Organic Key Drivers ($ in millions) Growth* Assembly $572 (4)% Significant impact from automotive and consumer electronic production slowdowns due to COVID in Q2 – recovered in 2H Circuitry $401 5% Growth driven by strong demand
Slide 7: Balance Sheet and Cash Flow Considerations
Balance Sheet and Cash Flow Considerations Key Cash Flow Items Balance Sheet Management ▪ FY 2020 free cash flow* of $249 million – growth1 of 5% ▪ Net debt to adj. EBITDA ratio* of 2.9x at year-end compared to 2019 adjusted free cash flow* ▪ Refinanced existing 5.875% bonds with 8-year bonds at a o
Slide 8: Full Year 2021 Financial Guidance
Full Year 2021 Financial Guidance As of January 2021 FY Adj. EBITDA* ~7% growth FY Adjusted $1.10-$1.15 EPS* (15-20% growth) Free Cash ~$275M Flow* (10% growth) ▪ Expect Q1 2021 adj. EBITDA* growth year-on-year of 8%-10% Additional ▪ Adj. EBITDA* growth expected to be first half weighted Considerati
Slide 9: ESG at ESI
ESG at ESI Published inaugural Established ESI Launched Macdermid ESI Sustainability Foundation Envio Solutions Report 9
Slide 10: Appendix
Appendix 10
Slide 11: Capital Structure
Capital Structure ($ millions) Instrument Maturity Coupon 12/31/2020 Corporate Revolver 1/31/2024 LIBOR plus 2.25% $0 First Lien Credit Facility - USD Term Loans1 1/31/2026 LIBOR plus 2.00% 735 Total First Lien Debt $735 Senior Notes 9/1/2028 3.875% 800 Total Unsecured Debt $800 Total Debt $1,535 Ca
Slide 12: Reconciliation to Adjusted Share Counts
Reconciliation to Adjusted Share Counts (amounts in millions) FY 2020 FY 2019 Q4 2020 Q4 2019 (Average) (Average) Basic outstanding common shares 247 250 248 254 Number of shares issuable upon conversion of Series A Preferred Stock - 2 - 2 Number of shares issuable upon vesting of granted Equity Awa
Slide 13: Net Income Attributable to Common Stockholders Reconciliation to Adj. EBITDA
Net Income Attributable to Common Stockholders Reconciliation to Adj. EBITDA ($ millions) Q1 2020 Q2 2020 Q3 2020 Q4 2020 FY 2020 Net income attributable to common stockholders $9 $1 $36 $30 $76 Add (subtract): (Income) loss from discontinued operations, net of tax (0) 1 0 — 1 Income tax expense (be
Slide 14: Net Income (Loss) Reconciliation to Adj. EBITDA (2019)
Net Income (Loss) Attributable to Common Stockholders Reconciliation to Adj. EBITDA ($ millions) Q1 2019 Q2 2019 Q3 2019 Q4 2019 FY 2019 Net income (loss) attributable to common stockholders $23 $2 $(7) $74 $92 Add (subtract): Net income (loss) attributable to the non-controlling interests 1 (0) — 0
Slide 15: GAAP Net Income Reconciliation to Adjusted Diluted EPS
GAAP Net Income Reconciliation to Adjusted Diluted EPS ($ millions, except per share amounts) Q4 2020 Q4 2019 FY 2020 FY 2019 Net income attributable to common stockholders $30 $74 $76 $92 Net income (loss) from discontinued operations attributable to common stockholders — 0 (1) 13 Net income from c
Slide 16: Quarterly Results Overview
Quarterly Results Overview 2019 2020 ($ millions) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Net Sales Electronics $266 $268 $280 $272 $269 $253 $307 $343 Industrial & Specialty 194 189 185 183 184 134 171 193 Total Net Sales $460 $457 $465 $455 $453 $387 $478 $537 Adjusted EBITDA Electronics $56 $60 $74 $63 $67 $58 $
Slide 17: Organic Net Sales Growth Reconciliation
Organic Net Sales Growth Reconciliation Three Months Ended December 31, 2020 Change in Pass- Reported Net Constant Organic Net Sales Impact of Currency Through Metals Acquisitions Sales Growth Currency Growth Pricing Electronics 26% (3)% 23% (3)% (4)% 16% Industrial & Specialty 6% (1)% 5% —% (4)% 1%
Slide 18: Free Cash Flow to Free Cash Flow on an Adjusted Basis Reconciliation
Free Cash Flow to Free Cash Flow on an Adjusted Basis Reconciliation (dollars in millions) FY 2019 FY 2020 Q4 2020 Cash flows from operating activities $ 171 $ 276 $ 82 Capital expenditures (30) (29) (7) Disposal of property, plant and equipment 5 2 - Free cash flows $ 146 $ 249 $ 75 Adjustments to
Slide 19: Non-GAAP Definitions
Non-GAAP Definitions Adjusted Earnings Per Share (EPS): Adjusted EPS is a key metric used by management to measure operating performance and trends. In particular, the exclusion of certain expenses in calculating adjusted EPS facilitates operating performance comparisons on a period-to-period basis.